BSD (Berkely System
Distribution)
was a research operating system based on the
original AT&T Unix, developed by the University of Berkeley, California. It has
been Open Source right from the beginning, and after the university lost
interest in developing it further, several community projects started up (the
very first ones were NetBSD and FreeBSD in the early nineties) to continue
developing BSD. Anyway, Linux was born roughly at the same time, but a pending
lawsuit about copyright infringements prevented the BSD projects to become as
successful as Linux (though you could argue about the exact reasons).

You just need to install the initial ports tree, and then it is just a simple matter of "make install clean" from the directory of the port you want to install.

Keeping the system up to date is a bit trickier than the software installation process, though. In FreeBSD there are usually n-ways of doing the same (installing ports, upgrading the system, etc) action. Which I think it's what may be confusing you initially.

You also were asking "what is the best way to install software in FreeBSD," so it seemed obvious to me that your proficiency with the ports system was not that good. Which is why I directed you to RTFM: http://www.freebsd.org/doc/handbook/ports.html